South Korea Ends 7-Year Block on Crypto Ventures

• Korea ends 7-year crypto venture ban, grants firms tax and funding access
• New rules align with global ETF and stablecoin adoption trends
• Crypto ventures gain support under Korea’s “deep tech” strategy

South Korea has lifted a seven-year restriction on cryptocurrency businesses, clearing the way for trading and brokerage firms to qualify as venture-certified companies. The Cabinet approved revisions to the Enforcement Decree of the Special Act on the Promotion of Venture Businesses, set to take effect on September 16.

The 2018 rule, which placed crypto alongside gambling and nightlife as “restricted industries,” is now being rolled back as regulators embrace stricter investor protections and stronger oversight of the digital asset market. Officials said the reforms will bring crypto businesses in line with other tech ventures while tightening compliance.

From Restriction to Regulation

Since 2021, South Korea has required virtual asset service providers to register with authorities. This year, lawmakers passed the Virtual Asset User Protection Act, introducing new rules to safeguard deposits and curb unfair trading practices. Officials say these guardrails paved the way for allowing crypto firms access to venture certification.

Related: South Korea to Roll Out New Legislation for Won-Pegged Stablecoins in October

With this change, companies can now tap into state-backed capital, accelerator programs, and tax incentives. Attorney Ted Koo of LIN explained the reform will also protect existing venture-certified businesses from losing status if they move into digital assets.

Access to Capital and Government Support

The new framework gives crypto firms access to the same venture ecosystem as other high-growth startups. That includes government accelerator programs such as TIPS and the K-Startup Grand Challenge, alongside tax breaks and subsidized funding.

Minister of SMEs and Startups Han Seong-sook said the move fits within South Korea’s “deep tech” strategy, aimed at channeling venture capital into blockchain, cryptography, and related fields.

Regional and Global Context

The shift also places South Korea closer to peers abroad. In the U.S., regulators approved spot Bitcoin ETFs in early 2024 and passed stablecoin legislation later that year. South Korea has introduced its own stablecoin bill, due for rollout in October.

Regionally, crypto venture activity is accelerating. Sora Ventures recently launched a $1 billion Bitcoin-focused fund, while Korean firm Bitplanet disclosed plans for the country’s first institutional-grade Bitcoin treasury with $40 million in seed capital.

Related: South Korea Rolls Out the Red Carpet for Crypto Startups; And the Tax Man